Novato biotech Ultragenyx makes much more than expected in IPO, shares rise in debut

Associated Press

Posted:
01/31/2014 11:50:57 AM PST

Updated:
01/31/2014 11:50:57 AM PST

NOVATO -- Ultragenyx Pharmaceutical raised $121 million through an initial public offering of 5.8 million shares priced well above a range the drug developer had forecast.

The Novato company expects its shares to begin trading Friday under the ticker symbol "RARE" on the Nasdaq market.

The company is developing several possible treatments for rare or extremely rare diseases. Its portfolio includes an intravenous enzyme replacement therapy for treating Sly Syndrome, a cellular and organ dysfunction that typically leads to death by the time patients become teens or reach early adulthood.

The drug developer started in 2010, and all of its treatments are in early stages of clinical research, meaning they are likely several years away from reaching the market if they receive approval.

Ultragenyx said Thursday that it priced the IPO at $21 per share after forecasting earlier this month a range of $14 to $17. Ultragenyx also said previously that it expected the offering to involve 4.8 million shares.

Ultragenyx plans to use offering proceeds for clinical research and to pay a cash dividend to holders of preferred stock. That will be paid once the shares are converted to common stock.

The banks managing the IPO have a 30-day option to buy an additional 864,054 shares, which would add to the proceeds.

Also on Friday, two other drug developers announced IPO pricings.

Trevena raised about $64.8 million after pricing an offering of nearly 9.3 million shares at $7 per share. The King of Prussia, Pa., company is developing potential treatments for acute pain and heart failure. It will trade under the ticker symbol "TRVN."

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Shelton, Conn.-based Cara Therapeutics raised $55 million after pricing 5 million shares at $11 each. Cara focuses on pain treatments. It will trade under the ticker symbol "CARA."